US PERM suspensions
The US Department of Labour has suspended several major IT outsourcing firms from the Permanent Labour Certification Program, or PERM, citing alleged abuse of the system and multiple active federal investigations. The companies named are Cognizant, Infosys, Tata, Wipro, HCL, Capgemini, Microsoft and Adobe.
The suspensions prevent the companies from filing new PERM applications while the action remains in effect. Applications already pending will also be placed on hold. PERM is the Labour Department approval that allows an employer to move forward with hiring a foreign worker for a permanent Green Card.
The programme is intended to ensure that employing foreign workers does not adversely affect the wages, working conditions or job opportunities of US workers in similar positions.
The action does not cancel H-1B visas or prevent the suspended companies from employing H-1B workers. It could, however, increase uncertainty for foreign professionals seeking to move from temporary work status to permanent residency. Companies may also face higher legal, compliance and administrative costs.
Vice President JD Vance said Microsoft laid off 6,000 American workers in 2025, was approved for more than 6,000 H-1B visas and filed 3,682 PERM applications. He said nearly 1,000 of those applications were for positions from which American workers had been laid off.
Vance said that, according to his calculation, Microsoft replaced each laid-off worker with one and a half foreign workers. Labour Secretary Keith Sonderling said, “There has been no company in the United States, unfortunately, that has abused this system more than Microsoft.”
The Labour Department’s action also covers nine universities, including Harvard, Yale and Stanford. Sonderling said the institutions would be investigated over allegations of undercutting American wages. Labour Inspector General Anthony D’Esposito said subpoenas had already been served.
About 37% of Indians who obtained Green Cards in FY2023 did so through employment-based preferences. The PERM action could therefore particularly affect Indian technology professionals seeking permanent residency.
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